Whiz kid with $42 million pay packet moves over as Zynga shares plummet
As games firm Zynga's shares plunged below $3, down $7 from its IPO price, it was revealed that Chief Operating Officer John Schappert, brought from Electronic Arts for "compensation" listed at $42.8 million, has been stripped of his role overseeing game development.
COO John Schappert]
Bloomberg reported that the move came in a reorganisation aimed at" reviving growth and making more money from mobile services." Another report said Schappert, a year in the job, was leaving the company .
David Ko, who runs the San Francisco firm's mobile operations, and Steve Chiang, executive vice president of games, will now report directly to Chief Executive Officer Mark Pincus, said Bloomberg, quoting people who asked not to be identified. Both had reported to Schappert.
Pincus embarked on the overhaul in early July, as sales slowed, it was reported . Schappert was said to have lost support within the company and taken some of the blame for its underperformance, the people told Bloomberg.
Pincus himself reportedly cashed in stock in the company months before the price dropped, selling shares at around $12 each.
“The place is in utter meltdown mode,” Richard Greenfield, an analyst at BTIG LLC in New York, said in an interview. “The real question I think everyone should be asking is why it took reporting a collapse in earnings to make a management change.”
Ko and Chiang will involve more of the company’s best designers on apps for smartphones and tablets, the report said.
Zynga makes money by selling virtual goods within its games, mainly on Facebook -- say, a gun in “Mafia Wars,” or a tractor in “FarmVille.”
It brings in 14 per cent of Facebook's revenue.